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CEKA, a 21% yield
Current, target price 1,820, 3,030 (+66%)
October 22nd, 2021
1 minute read
Sales jump on higher prices
Costs, margins improving
1 minute read
Sales jump on higher prices
- Sales jumped by 15% in the third quarter to 1,379 billion rupiah which is only slightly below our forecast 1,398 billion rupiah.
- This brings the average quarterly growth to 13%.
- We predict average growth of 8% in this next 12 months to bring sales to 1,848 billion rupiah in the third quarter of 2022.
Costs, margins improving
- The cash cost ratio was slightly lower at -96% in the third quarter & profit doubled to 54 billion rupiah.
- Cashflow costs are now the same at -96%.
- We use the lower average -95% costs to predict a 80 billion rupiah profit in the third quarter of 2022.
Cashflow doubles
Balance sheet, slightly less net cash
Value, a 21% yield
- Cashflow was 2X higher at 26 billion rupiah even with higher investment spending of -21 billion rupiah in the third quarter.
- Average quarterly Cashflow has now improved to -4 billion rupiah.
- We use lower -14 billion rupiah investment spending which with higher sales gives a positive again 72 billion rupiah cashflow in the third quarter of 2022.
Balance sheet, slightly less net cash
- Cash increased again from 296 to 321 billion rupiah in the third quarter.
- Liabilities also increased from 213 to 250 billion rupiah so net cash declined from 83 to 71 billion rupiah.
- With our forecast cashflow & a -230 billion rupiah equity payout, net cash will be 96 billion rupiah in 12 months time.
Value, a 21% yield
- CEKA capital from the last six years increased slightly to 969 billion rupiah in the third quarter & will be 1,223 billion rupiah in 12 months time.
- At the current market value of 1,083 billion rupiah, based on our forecasts, it’s at 0.67X assets with a 4.9 years payback & a 21% yield.
- Our free cashflow forecast is 255 billion rupiah which is a 4X valuation. At a 20X valuation gives a 66% higher target price of 3,030 rupiah.
